Owens, et al, v. FreshDirect LLC, et al.

On March 19, 2014, Willard Owens, Jeremy Ellison, Thomas Livingston and James Rousseve filed a putative class and collective action Complaint against Fresh Direct LLC, Jason Ackerman and David McInerney in the U.S. District Court Southern District of New York, which is assigned case number 1:14-cv-1909.

Who are the putative class and collective action members?

The lawsuit is brought on behalf of all individuals whom Defendants employ or have employed as delivery personnel at any time since March 19, 2008 in the State of New York.

What are the claims?

The lawsuit alleges two causes of action on behalf of the delivery personnel.

Unlawfully retained gratuities under the New York Labor Law (“NYLL”)

This claim concerns the mandatory delivery charge Fresh Direct charges its customers.  As alleged in the Complaint, Fresh Direct’s customers reasonably believe this charge is the delivery personnel’s gratuity and therefore infrequently give the delivery personnel gratuities.  Yet Fresh Direct retains 100% of the delivery charge and does not remit any of that money to the delivery personnel.  The Complaint accordingly alleges that Fresh Direct is liable to the delivery personnel for the delivery charges it has unlawfully retained.

Failure to pay overtime under the Fair Labor Standards Act (“FLSA”).  This claim also concerns the mandatory delivery charge.  As alleged in the Complaint, because this charge is a gratuity, it is considered wages under the FLSA and must therefore be included when calculating the delivery personnel’s regular hourly rate.  Yet Fresh Direct did not include the delivery charge in their regular hourly rate when calculating their overtime rate.  The Complaint therefore alleges that Fresh Direct is liable to the delivery personnel for the difference between the overtime rate at which they were paid and the correct overtime rate:  one and one-half (1.5) times their regular hourly rate that includes the delivery charges.

Case Status:

  • On March 19, 2014, Plaintiffs filed the Complaint.
  • On March 30, 2014, Plaintiffs filed the First Amended Complaint.
  • On July 9, 2014, Plaintiffs filed the Second Amended Complaint.
  • Defendants filed a motion for summary judgment or, alternatively, a motion to dismiss the Second Amended Complaint.  This is the type of motion in which Defendants attempt to have a case dismissed based solely on the complaint.  The Court has not ruled on this motion.  This means the lawsuit remains active and it has not been dismissed.
  • On June 11, 2015, the parties submitted to the Court for preliminary approval a settlement agreement, which would resolve these claims on a class-wide basis.  If the Court grants preliminary approval of the agreement, class members will receive a notice in the mail detailing all of the settlement’s relevant terms and explaining the class members’ options with respect to the settlement.  The notice will be mailed out within 30 days of the Court granting preliminary approval of the agreement.
  • On June 22, 2015, the Court granted preliminary approval of the class-wide settlement agreement.
  • On October 30, 2015, the Court granted final approval of the class-wide settlement.  Provided no appeals are filed, the authorized claimants’ vouchers will be mailed no later than December 30, 2015.

By the end of July 2015, the Court-approved third-party claims administrator (Simpluris, Inc.) will have mailed to all class members an information package that details the settlement terms and advises the class members on their options with respect to the settlement.  Again, it is a third-party who will be doing this – not this firm and not FreshDirect. If you want to update or confirm your address with Simpluris (the Court-approved third-party claims administrator), you can contact them at 1.877.723.7131.

Please contact Douglas Lipsky with any questions.

*This update is based solely on information that is publicly available. This update is current as of November 3, 2015.